SYNNEX Corporation (NYSE: SNX), a leading business process services
company, announced today in a separate press release issued jointly by
SYNNEX and IBM (NYSE: IBM), that SYNNEX will acquire IBM’s worldwide
customer care services business. The acquisition will be combined with
Concentrix, a wholly-owned subsidiary of SYNNEX and a recognized leader
in providing platforms, people and services to support high-value
interactions at every stage of the customer lifecycle.
Pursuant to the asset purchase agreement, SYNNEX will pay a purchase
price of $505 million, consisting of approximately $430 million in cash
and $75 million in SYNNEX common stock. The transaction is expected to
add an estimated $120 million in earnings before interest, taxes,
depreciation and amortization (EBITDA) and approximately $0.55 in fully
diluted earnings per share (EPS) excluding one-time charges and
integration costs in the first 12 months post the closing of the
transaction. The $405 million purchase price premium includes an
estimated 40-50% in intangible assets which will be amortized over two
to ten years.
As client requirements for BPO have shifted towards high value business
outcomes, insights, and alternative delivery models, this transaction
accelerates Concentrix’ geographic and industry reach with combined deep
expertise, scale, process innovation and continued investments in high
value industry platforms.
“This acquisition will make Concentrix a global Top 10 player in a
growing market,” stated Kevin Murai, President and CEO of SYNNEX
Corporation. “With our collective strengths in the CRM BPO market, this
strategic acquisition will create an even more compelling value
proposition for our clients and shareholders.”
“The new CRM BPO business will leverage the combined deep expertise,
scale, process innovation and investments in high value industry
platforms and assets to provide the customer experience and service
innovation you have come to expect from IBM,” said Lori Steele, general
manager, IBM Global Process Services. “The pace of change in
customer care requires constant innovation. This acquisition by SYNNEX
further enhances our mutual commitment to client satisfaction through
one of the world’s top customer experience BPO providers. Clients can
invest with confidence in the proven abilities of these two leaders to
deliver the best customer care solutions.”
“I am thrilled with the talent that will be coming over to Concentrix,”
said Chris Caldwell, President of Concentrix Corporation. “We have long
been committed to delivering high quality, innovative CRM BPO services
and this acquisition will significantly extend our portfolio and our
delivery capabilities.” Caldwell continued, “This is an important step
in our continued growth by providing a unique aggregation of world-class
customer engagement capabilities to our clients that we could only have
acquired from IBM.”
SYNNEX will enter into a multi-year agreement with IBM in which
Concentrix will become an IBM preferred business partner for global
customer care BPO outsourcing services, providing an extended ecosystem
and delivery engine for Concentrix’ and IBM’s extended partners and
solution providers.
Once the transaction is complete, Concentrix will have approximately
45,000 employees servicing over 300 clients in over 40 languages through
over 50 delivery centers on six continents.
The transaction is expected to initially close in the coming months,
subject to the satisfaction of regulatory requirements and customary
closing conditions.
Until the transaction is completed, the companies will continue to
operate independently.
Additionally, subject to SYNNEX’ completion of its normal quarterly
close and reporting process, revenues for the third quarter ended August
31st are now estimated toward the high end of the prior
guidance range of $2.65-$2.75 billion. As announced on September 6,
2013, the Company will report its Q3 2013 earnings results and hold a
conference call on September 25th.
Analyst/Investor Conference Call
An analyst/investor conference call will be held to discuss the
acquisition at 2:00 p.m. PT and will be hosted by Kevin Murai, President
and Chief Executive Officer; Chris Caldwell, President, Concentrix
Corporation, Dennis Polk, Chief Operating Officer; and Marshall Witt,
Chief Financial Officer.
The conference call will be webcast at http://ir.synnex.com
and will be available via telephone by dialing (888) 469-3219 in North
America or (630) 395-0205 outside of North America. The passcode code
for the call is “SNX.”
A live webcast and replay of the investor call will be available to the
general public at http://ir.synnex.com.
The replay of the webcast will be available at http://ir.synnex.com
approximately one hour after the conference call has concluded.
About SYNNEX
SYNNEX Corporation (NYSE: SNX), a Fortune 500 corporation, is a leading
business process services company, servicing resellers, retailers and
original equipment manufacturers in multiple regions around the world.
The Company provides services in IT distribution, supply chain
management, contract assembly and business process outsourcing. Founded
in 1980, SYNNEX employs approximately 12,500 full-time and part-time
associates worldwide. Additional information about SYNNEX may be found
online at www.synnex.com.
About Concentrix
Concentrix Corporation is the global business services division of
SYNNEX Corporation with award-winning expertise in providing our clients
with platforms and services to enable their customer strategy. From
locations in the Philippines, China, Costa Rica, Nicaragua, Canada, the
United States, United Kingdom, Hungary, India and Japan, our more than
8,000 employees support millions of transactions in multiple languages
and countries worldwide. Concentrix Corporation is a wholly-owned
subsidiary of SYNNEX Corporation (NYSE:SNX), a Fortune 500 company. For
more information, please visit www.concentrix.com.
Safe Harbor Statement
Except for the historical information contained herein, the matters set
forth in this press release, including the anticipated benefits for
SYNNEX of the acquisition of IBM’s worldwide customer care services
business, including future financial and operating results, value to
SYNNEX’ customers and stockholders, SYNNEX’ plans, objectives,
expectations and intentions and the timing of the closing, are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are
subject to risks and uncertainties that could cause actual results to
differ materially, including, but not limited to, the risk that the
transaction will not close as anticipated or at all, difficulties in the
integration of acquired businesses, the risk that the benefits from the
transaction may not be fully realized or may take longer to realize than
expected, or that the transaction will not be accretive to SYNNEX’
operating results, disruption from the transaction making it more
difficult to maintain relationships with customers or employees, and
competition, third-party relationships and revenues, and the risks
detailed in SYNNEX’ Annual Report on Form 10-K for the year ended
November 30, 2012, and Quarterly Report on Form 10-Q for the quarter
ended May 31, 2013, as filed with the Securities and Exchange
Commission, and in other reports filed with the SEC by SYNNEX from time
to time. These forward-looking statements speak only as of the date
hereof. SYNNEX disclaims any obligation to update these forward-looking
statements.
Copyright 2013 SYNNEX Corporation. All rights reserved. SYNNEX, the
SYNNEX Logo, CONCENTRIX and all other SYNNEX company, product and
services names and slogans are trademarks or registered trademarks of
SYNNEX Corporation. SYNNEX, the SYNNEX Logo and CONCENTRIX Reg. U.S.
Pat. & Tm. Off. Other names and marks are the property of their
respective owners.
SNX-F
Copyright Business Wire 2013